Lay’s, Kurkure and Bingo are taking over Indian snacks like Aloo Bhujia, Murukku

• Three in five snacks sold in India are Western, while the remaining two are Indian.
• Overall, the organized Indian snacks market stands at ₹41,000 crore.
• The desi namkeen segment has been losing out on their market too due to four factors.

The changes in customer preference is pitting India’s traditional snacks like Aloo Bhujia, murukku, makhane and more against international brands like Lays, Bingo and Pringles. While this may come off as a comparison of apples and oranges, it does stand true.

India’s traditional snacks are losing their market share to the Western-influenced ones. Three in five snacks sold in India are Western.

“With increased penetration and movement from Indian ethnic to Western snacks, regional players are now competing with established Indian and international players,” a recent report by ICICI Securities read.

Overall, the organized Indian snacks market stands at ₹41,000 crore with PepsiCo, ITC, DFM Foods, Prataap Snacks and a few others dominating the sector.

Strong distribution, wide flavour range at varied price points and aggressive promotion are some of the leading drivers for Pepsico and ITC strong portfolio and market dominance. However, the stronghold of the top players is gradually declining with consumer preferences shifting to these mid-size players like DFM Foods, Balaji Wafers, Pratap Snacks, Maiyas, Laxmi Snacks and a few others.

The Indian ethnic snack market is led by Haldiram, with IPO-bound Bikaji one of the top contenders in the north and earth Indian market.

Flavours, prices and availability

The data shared above does not include the unbranded Indian snacks or the desi namkeens that are usually sold in small kirana stores, chai tapris and other such stores.

“The unorganised market is so huge that it remains undocumented, and even we don’t know the size of the total market,” Chittranjan Dar, CEO of ITC Foods, was quoted as saying by Economic Times.

The report by ICICI Securities mentioned that the desi namkeen segment has been losing out on their market too due to four factors — flavours, pricing, consistent availability and convenience of buying of Western brands.

The Indian savoury market is driven by Western snacks with a market share of roughly 58.3%. Ethnic namkeen and snacks’ market share is at 26.3%; and ethnic bhujia has a 15.4% market share. In other words if 10 snacks are sold in India, six would be Western, three would be ethnic and one would be bhujia.

There is no doubt that the demand for regional snacks is increasing pan-India, especially due to urbanization and migrant spreads. But the demand for Western products is increasing much faster.

“In the market, there is a range of branded and unbranded chips and extruders, which are usually limited to a city or even an area within a city. Furthermore, in India, customer preferences are evolving toward packaged Western snacks,” the ICICI report noted.

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